Vedanta Ltd
Vedanta Ltd is a diversified natural resource group engaged in exploring, extracting and processing minerals and oil & gas. The group engages in the exploration, production and sale of zinc, lead, silver, copper, aluminium, iron ore and oil & gas. It has presence across India, South Africa, Namibia, Ireland, Liberia & UAE.
Its other businesses includes commercial power generation, steel manufacturing & port operations in India and manufacturing of glass substrate in South Korea and Taiwan.
Revenue Breakup
Aluminium Products- 39.5%
Zinc Metal- 20.33%
Copper Products – 14.98%
Iron Ore- 4.81%
Silver Metals and Bars- 3.78%
Shareholding Pattern
-PUBLIC GROUP
-PROMOTER GROUP
Financial Summary
| Particulars | Mar 2022 | Mar 2023 | Mar 2024 |
| Sales | 132,732 | 147,308 | 143,727 |
| Sales Growth % | 50.80% | 10.98% | -2.43% |
| Expenses | 87,908 | 112,877 | 108,415 |
| Operating Profit | 44,824 | 34,431 | 35,312 |
| OPM % | 34% | 23% | 25% |
| Net Profit | 23,710 | 14,503 | 7,539 |
| EPS in Rs | 50.58 | 28.45 | 11.40 |
Synopsis of Financials
- Quarterly Revenue: Achieved ₹35,239 crores, a 6% increase year-on-year.
- EBITDA: Surged to ₹10,275 crores, a remarkable 47% year-on-year growth.
- EBITDA Margin: Increased by 10% to an industry-leading 34%.
- Profit After Tax: Rose sharply by 54% year-on-year to ₹5,095 crores.
- Free Cash Flow: Before capital expenditures stood at ₹4,371 crores, up 41% year-on-year.
- Net Debt-to-EBITDA Ratio: Improved to 1.5x year-on-year from 1.9x, showcasing strong financial health.
Final Outlook
Vedanta Limited (VEDL) has strong fundamentals, good revenue growth, and a healthy ROE. However, the company’s profit growth has been poor and its book value has been trending down.
Revenue and profit
- In FY 2022-23, Vedanta’s consolidated revenue was ₹1,47,308 crore, a 10.9% increase from the previous year.
- In FY 2023, Vedanta’s net loss was ₹14,506 crore, a 63% increase from the previous year.
- In FY 2023, Vedanta’s earnings per share (EPS) was ₹28.50, a 44% decrease from the previous year.
Valuation
- Vedanta’s price-to-intrinsic value is 0.289, indicating that the company is undervalued.
- Vedanta’s price-to-earning ratio is 12.12, and its EV to EBITDA is 6.08, also suggesting that the company is undervalued.
Other financial metrics
- Vedanta’s cash conversion cycle is -15.86 days.
- Vedanta’s ROE has been 20.36% over the past 3 years.
- Vedanta’s promoter pledging is high at 99.99%.
ESG score
According to MSCI, Vedanta’s ESG score for its industry is good.
I would give Buy recommendation for this stock
Vedanta-Ltd